IRA inheretance tax
my aunt died 2 months ago and
received a notice that I am the
benificiary of her IRA. It is worth
$200,000.00. I was given an option
to roll it over or liquidate and take a
lump sum. If I decided to take a lump
sum how much federal and state (IL)
tax do I have to pay
1 Answer from Attorneys
Re: IRA inheretance tax
While inheritance is not taxed, you would be subject to income tax on the entire amount of the distribution in the year you receive it.
You might want to look into other options of distribution so that you can spread out the distribution over a number of years and lessen the tax burden.
Talk to a financial advisor (not just a customer service clerk) who is knowledgeable in IRAs and retirement plans for the best advice in your particular situation.
Good luck to you.
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